This paper introduces the application of supervisory monitoring system for substation automation based on IEC 61850. The objective of proposed system is detection of such a malfunction or degradation of devices. The supervisory monitoring procedure consists of a two step - topology processor and state estimation. The topology processor using artificial intelligence is a preprocessing step of state estimation. Topology processor identifies the topology structure of switches in substation and detects an error of ON/OFF state data. The state estimation is an algorithm that minimizes an error between optimal estimation values and real values. The proposed system is applied to standard digital substation based on IEC 61850 for performance verification.